Tech Talk – Not So Fast! – June 25, 2024

June 26, 2024

In this episode of Tech Talk, Andy and Cody discuss August milk, December corn and December Wheat.

Questions or comments? Charts you’d like to see? Contact us at Insights@Ever.Ag, or give us a call at (312) 492-4200.
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Hello everybody. Welcome back to another episode of Tech Talk. I am Cody, he is Andy. It is the 25th of June, about 330 eastern time in the afternoon. 230 central the correct?

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I think so close enough. But enough gets us enough. What are you going to do within.

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The same day?

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So it’s Tuesday. Let’s do that. Right.

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It’s Tuesday. We’re rocking.

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All right. We got that much going on. Let’s do.

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We have to do something to lighten the blast.

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Yeah, we got some new sound effects on the board. That’s pretty cool. I don’t know, like I said.

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Let me say I run. They just run to the sound effects board so we don’t know what this is.

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And probably a good thing that she’s running that, not us. I don’t think there’d be much talking going on. It would just be Peppa. Peppa. And there you go. That’s that’s that’s it. Three cheers. Me, I think we had one of them came. I requested this one.

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I think so August about three.

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Yikes. What do you think your boss.

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well, well, I mean, that’s, this little blow of $20, right? We weren’t. Did we set a limit down to that?

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I believe so. So. Oh, yeah. We did. Yep. Oh, good. It was limit.

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Okay, so we set our scope limit down. So that’s going to be the lowest settle that we had going back until the 31st. oh no. 30th of May. Right. You go to the end of May until we’ve had a settle that low.

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I’ll do your point. We basically got in below. We haven’t gotten below 20 bucks yet, but we’re super close. But this is starting to look like a nice little head shoulders, isn’t it?

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It is.

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So I’d say you’d say the neckline is right around here somewhere where it basically where it broke out from right here, right at the end of May. Just head shoulders. Look out. I mean, this getting a little bit dicey, isn’t it? The get this this you’re talking about getting probably back down around that. You know Rosalie’s low. Yikes.

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So got down around 1930 1940 ish.

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As you said. Actually you know, I’ve got about 1940 maybe 1945 with premium now.

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So it’s but I mean, you look at like if you just take the fib like the Fibonacci of this whole move, start talking about, you know, between this half in two thirds retracement, I think you’d expect if you were to have a true head and shoulders that breaks to the neckline. And so I guess the confirmation is we set a limit today.

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So that’s 29. We need to open lower. And then you know basically break through this this point which is basically 20 bucks for this market took off from right here. And then it starts. Then it just turns and it could, it could get a little bit nastier. I mean, let’s say if cheese really starts to retrace, I mean, we’re not I don’t think we had this one slotted today, but still worth looking at, right.

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Since August starts pricing here pretty soon. This is the cheese. And we’re looking at how this was a pennant. This turns into a breakout. you know you wait, you trade the breakout and you wait for that confirmation. So you, you know, trading it like what? Worse than, like, with more confirmation.

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Technically, we have not broken out of that pennant, right?

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Correct. Correct.

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Tuesday. So second, second day when.

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We do this layout, we do this last week haven’t broken out, but we still have you know this Bill Gabbert here and here. So come back August. Yeah this you had that breakout of the cheese. And you know this would be a pretty healthy you know pretty nice head shoulders. You’d have the spot confirming pretty nice chart here.

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So I guess to that point it’s even though we’ve had a significant break, you can still justify getting.

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Short that RSI doesn’t look like it’s giving the bulls any favorites right now.

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Now and then it turns into a question of like, you know, the whole fundamental piece of it, right? It’s the massive amounts of like promotional stuff. Is that going to be enough? We had another production lower year over year. So there’s you know, there’s that school of thought right now right where it’s, hey, are we get two week break.

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How much really can we break with milk production continuing to trend down and we’re heading into summer like grilling etc.. But again the head and shoulders pattern, it’s a cut and dry. Like you want to be short that if we, you know, let’s say we break this neckline, that’s that would be like the indicator of you can go in here and get short and kind of just put behind you two that the market’s at a significant break leading up to that point.

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Yeah.

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So I know you don’t like selling stuff. Maybe you could buy puts.

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This might be the opportunity.

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Think does your mouse have a right click button.

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It does I mean it’s on there. It’s it’s pretty dusty because we don’t use it very often, but.

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We don’t use it the editorial way, the royal way is your left click button like really worn. But you’re, you’re right click buttons like fresh. So yeah, it’s just never been clicked.

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It’s like a new mouse. The right sides new, the left sides used.

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Well, speaking of something you don’t probably don’t want to buy just yet, do these corn.

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I don’t think after today you’d want to buy that just yet.

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Yikes. So what’s interesting about this one is that just looking at the last two candles, this is today’s closed 30 closed. Yeah. This is yesterday. Right. So you had a potential hammer. But that body, you want that for it to be a true hammer, you’d want it to be green, right? A pretty significant rejection of low close near the high of the day.

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That’s a typical like hammer formation. This is not where you closed below the open. That’s like the red body. But what kind of, you know, cemented that was just basically it’s not going to see expression. It’s stuff. The first trip to a price that scares people. It’s the second and third times. Yeah. You know we went right back to closing basically.

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But was this low for 443. But it’s closed for 43. Closed on yesterday’s low. Yeah.

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I tell you what, man, I think I’ve had a lot of people that called in asking me what was going on in corn just because of that massive wick that we made yesterday getting close to the close. And it all kind of came right after I’d say noon, right? I mean, getting into the close, we rallied ourselves back.

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Look at those issues yesterday.

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Yeah. And then today no dice.

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So this was okay. So this is a 15 minute. So we can kind of look at some of the intraday activity. So this was yesterday’s this is yesterday’s activity basically right here. Yeah a nice little popper towards around noon central that stuck. So to your point rally back. But then just basically gave it back during the overnight session and then some.

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Right.

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But what’s interesting about this too is that ever since you made this lower high right here, it just hasn’t really looked back. It tried to come back in and then had an immediate failure. Since then, it’s just been the see you later, alligator.

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Well, and you start looking at a weekly I just got a weekly pulled up here.

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Can we let me do that?

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And, I mean, it’s not within bullish, right?

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Is that your way of saying it’s bearish. It’s not looking bullish.

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Yeah. Exactly right. You got to be an asset for kind of person.

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I mean it’s not exactly looking that bullish.

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But again so you’ve got support down at $4 which has been a big I’d say industry talking point of oh some people are $5. Some people are thinking we’re gonna go to $4. You look at the support at $4 and I would likely be a buyer at $4.

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So this the longer term, like secondary stuff. Cross zero here. This was last week getting some confirmation here. So the momentum is clearly term. There’s room here in the RSI for it to continue to break for it’s considered oversold. It’s a two year point. This $4 mark basically this low right here could turn into a bit of a magnet right.

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I don’t know that much about fundamentals with regard to grain. So you want to check out grain feed Jake and all right. But is it like a weather market. Is it is it El Nino I don’t know. Oh. Other tropical.

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Storms must.

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Bow before El Nino. Here, point that this looks weak. And you’ve got some room here on the weekly. The daily. I mean, to close on yesterday’s low after settling off a low the way it did, even though it wasn’t a true hammer. That’s just a sign of weakness. This is the second trip to a price that scares people.

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So. And you know, you’ve managed to stick a close below all this to. Right? This guy right here, that’s not good.

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Which I think yesterday got the bulls excited because we could not settle below 450. And then today they came back and said.

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But that’s so fast.

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That’s all.

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That’s so fast, Richard, speaking of not so fast off. Oh my goodness, wheat quit December wheat. We have a guy in our office at Bakes Bread Yarn. He’s excellent Baker. He’s a great reason he’s got to start using some more wheat.

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It does.

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I mean, it just gets getting cheaper is just not making enough bread.

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Keep that bread on the pump.

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Not that bread. Let’s go. There’s not really much to. We just want to bring this one up. It’s because it’s just been a straight mean. We’ve had this is May 31st is really really I mean you could go back and look at it from May 28th. So I don’t know about a calendar months worth of trade. It had to close higher.

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Yeah. To that’s it. The rest have been closes lower second night. That’s just that’s brutal in there.

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Not small moves by any means. No no not limit moves. Right.

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But no but still talking.

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$0.20 in some of these.

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Yeah I mean you’re talking this is 750 now we’re not going on 582. So over a dollar. But our $10.15 a bushel. That’s a massive move. And you think about like the percentage difference between seven, you know, 750 and 582. Right? I’m not a math wizard over here. Maybe you are. You know, like you can use your left click button on the calculator.

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That does work. Yeah.

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I let me see this. We get down to 570. Would you be a buyer there?

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I don’t think you can. Like it’s it’s hard to say that you want to be a buyer here until this chart tells you that there’s at least some sort of support.

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Right. I mean, of sense away from there and.

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And like, you know, here’s here’s an interesting example, right? I just kind of zoomed in on these two days, they break. You started to get some sign of strength, but you had no follow through the next two. And then book. No, sir.

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Here’s an interesting one. Check out the monthly real quick look at the engulfing the candle.

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I mean, like you got to be super careful of that going. Yeah. The momentum. They’re just heading back down below not below. But I mean around, you know, five bucks becoming a Magda. Right. Monthly has room to go here right here. And then the momentum clearly shifting to the downside. So yeah it’s no good I mean to answer going to try to answer your question.

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Like when do you at least get out of shorts or something like that. Or when do you start considering like is it time to get long? I think you need to have like, this is a great pattern right here. You had this inside day right here. Right? And then an open higher the next day. Inside out three bar pattern.

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Right. That’s a great pattern for like at least like a reversal type pattern too. So something like that. I would also be looking for some sort of like to your point, like it doesn’t have to necessarily have to be on a weekly or excuse me until very long term chart, but imagine like if this was a red candle and this was a green and it completely engulfed the previous day’s range.

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And you got confirmation.

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The next day, right in some way. Right? Right. Yeah. Ideally would want to open higher from the previous day’s high, but at least like see some sort of open higher. But yeah, it’s like it’s just it’s hard to say like to look at that, that the daily chart. Let’s go back up as well. I tend to look at that daily and just say like when you want to buy it once, it’s like, oh, show me some concern thing.

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What did you always tell me? Whether it’s grains or dairy, no matter what it is, it’s always hard to catch a falling knife. And it feels like that is exactly what we have going on in wheat right now.

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Yeah. I mean, you got pretty bloody right here, right? Because you likely weren’t buying it on this day. Like maybe you took a shot at towards the end of the day, or at least like kind of getting it like some sort of confirmation, like, hey, we’re going to close higher. Yeah. And then but, but but not so much.

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Yeah. So it’s easy. Yeah. To your point, I mean like it’s when you want to try to catch the falling knife, my answer would be no. I look for I look for some sort of engulfing pattern like that three bar pattern that we just at the inside out there over here, right here. It’s a great example of, of like maybe it’s time to at the very least get out of shorts and buy calls or do something to that effect.

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Sell something, just do something to mitigate any sort of like if you have some short exposure that you for short like Hedges honors that. But yeah, it’s that’s a tough one. You have to have something. There’s there’s something has to appear on the chart to make you want to own it, or at least get out of shorts.

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So far that has not come to fruition.

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So this is not exactly like your type of episode, by the way. There’s a lot of selling going on, a.

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Lot of selling, a lot of red.

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A lot of out of red line on the red. But you know, that said, let’s let’s try to let’s try to fill that glass up at least halfway like this. Right. Has cost your dairy doing with milk versus feed and other like all that like a more on a margin perspective.

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And so I think that’s the hard part. Everyone everyone talks about margins. And here’s my, here’s my pet peeve with talking about margins is milk was higher foods lower. But let’s consider everything else in the world that’s higher. You’ve got higher labor costs. You got higher fuel costs, you got higher. Everything else is higher. So when people want to talk about margins, you know, getting better, it might have been there for a little bit, especially if you were in a class four space, if you were in a purely cheese space.

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I’ve talked to guys who who the margins aren’t any better now than they were five, six months ago.

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Okay, so what you’re saying is don’t look at, you know, milk minus corn and Neil and say things are rosy over here.

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Exactly. And I think that’s what a lot of people like to look at and say, oh, margins are getting better. People are making money. That’s not.

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True. Negative ghostwriter.

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That’s not true for everyone. Right? It might be it might be true for a certain amount of individuals, but it’s not true for every single entity out there. Or put it that way.

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So can we put like a name tag on yours? It’s just negative Nancy and I like I, I’m just kidding. I’m just kidding.

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That’s all right. Sorry, Elon.

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How it is. It’s just being as real as humanly possible. You’re like.

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Oh, tears.

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Anyway. Though those are the three charts for Andy nine Tech Talk this week. But to give a big shout out to Paige and Lexi for doing this, behind the scenes editing on these awesome videos that we do, please like subscribe. They’re still trying to get to 10,000 subscribers.

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We’re close right? How about you? And I think every week you say that we’re we’re super, super close. We’re just minutes before.

00;14;21;00 – 00;14;33;17

We get to 10,000 subscribers. I got a big surprise for everybody. More than what Phil already promised me about going to the moon. I’ve got another massive surprise for everyone. If we get 10,000 subscribers, you’re not going to want to miss it. It’s going to be good.

00;14;33;19 – 00;14;35;28

Can we get a hint?

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Has to do with Chris Farley. So okay. With that being said if you’re a big Chris Farley fan Tommy Boy fan get us to 10,000 subscribers. You will not be disappointed. I can promise you that.

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Promise. That’s a promise.

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That’s promise, that’s promise. Wild one. Are you.

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how old are you, by the way?

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33.

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Oh, okay. I was going to say, like, if we got the 10,000 subscribers or are you going to, like, run for president? But I think gives a B 35 to do that.

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Give me a couple years.

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We’ll do a couple of years here. It cost year 2028.

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Give up for next.

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Like if we get the 10,000 subscribers I’ll put your name on the ballot and I’m going to.

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Put it on the sticker.

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That’s good.